Throughout history, there have been a few recurring themes in times of upheaval. One of them is resilience and how to make it through tough times. Another one is the importance of strong leadership.
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This latter is quite often misunderstood. For some, “strong” translates to authoritative, untransparent and autocratic decisions that are communicated poorly (if at all).
The only instance when this leadership style is effective is in actual battle. Commanding officers have to give direct orders to ensure a positive outcome for their troops.
While the corporate world may resemble a battlefield at times, this leadership style is not adequate at all. It has adverse medium and long-term effects, as employees lose their motivation and leave, or stay but perform poorly due to a lack of engagement.
So, which leadership styles are appropriate for these times?
3 Leadership styles that work in times of crisis
The good news is that there are several leadership styles to choose from, depending on the nature of the company and the situation in which it finds itself at a certain time. Let’s explore three of these:
“Democratic” sounds very modern and evolved. It is sometimes called participative leadership for obvious reasons – managers ask for and listen to employees’ opinions before making a decision. Since people feel seen and heard, democratic leadership generates high employee engagement and satisfaction levels.
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Fostering open conversations and participation is especially effective in organizations that have a strong focus on innovation and creativity. This style is a good idea nowadays because it ensures that the employees can truly contribute to the workplace.
There is also a downside to doing things this way. This leadership style can be costly because of the resources invested in setting up group discussions and the time it takes to reach a decision that most employees feel comfortable with. In today’s dynamic corporate environment, time is money. Consequently, not acting fast enough to seize an opportunity can be rather detrimental to business.
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“Visionary” also has a positive ring to it. In reality, true vision is rather scarce and highly valuable. Generally, visionary leaders are also highly charismatic. Employees follow and believe in their vision even in the direst of circumstances.
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The key is to hire the right people. The teams need to share the leader’s and organization’s goals and values before they get to work. When employees believe in the company’s vision, they stop working for the paycheck (though that is still important, of course) and put in all their knowledge and innovative resources to make the organization move forward towards a shared goal.
We can find this type of leadership in small, fast-growing, and groundbreaking startups since it takes a visionary leader to convince employees and investors to take a leap of faith. However, you can find this leadership style equally effective in large organizations that are either facing a major transformative challenge or unprecedented economic conditions.
This type of leadership is highly focused on employee motivation, clear communication, and appropriate goal setting. It doesn’t necessarily spend a lot of energy on each person's objectives but looks more to the bigger picture and investments in critical organizational gaols.
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Additionally, transformational leaders don't ignore the human factor. They are focused on giving their teams the tools and training they need to do well.
On the upside, transformational leadership values a positive connection within the team. This attitude and organizational culture are highly beneficial for employee morale and loyalty. It also places a significant focus on company values and ethics, both of which are paramount in surviving times of crisis.
On the downside, since the eyes are constantly on the prize, leaders can sometimes miss highly relevant details if they're only focused on the bottom line.
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Leadership is a highly complex concept. There are many theories and at least a dozen established leadership styles, each effective in the right context and executed by the right person.
The global economy is now in a delicate situation and so are most companies. While this is not the time to invent a new leadership style that is perfectly tailored to the present-day context, managers do have to adapt by adopting a way of doing things that will be good not only for the organization but also for its employees.